The German economy failed to grow at all in the second quarter of the year, according to official figures. The sharp deterioration in Germany’s economic prospects has been a setback for the government, and it could yet put strain on the European Union’s stability pact0

Prognoses about German economic growth are getting gloomier, and yet few expect that the European Central Bank will help by lowering interest rates when it meets on May 10th. How much pessimism about Europe’s biggest economy is justified?0